Trade and investment between Mexico and the United States have become one of the main doors that allow for strengthening Latin American startups and helping to open new opportunities for the region’s other countries
In addition to helping boost the countries’ economies, relations between Mexico and the Central American nations are also advantageous since many businessmen see Mexico as an excellent (investment) door for access to the rest of Latin America. Undoubtedly, this signifies a boost for those entrepreneurs who want to cross borders with their business ideas.
Miami is a bridge for Latin American startups
An example is the case of Miami, which is currently beginning to position itself as the bridge city that connects the Latin American region with the United States. Connecting Miami’s know-how and economic power in creating startups in Latin America and ecosystems with ingenuity is a great point of departure for creating new entrepreneurial economic activity.
On the other hand, a study by Endeavor and Glisco shows that in 2022, Mexico was one of the markets in Latin America that received the most significant amount of capital from startup investors. The country registered almost 75% of the investments made in the region, along with Brazil.
In this sense, both Mexico and the city of Miami are key locations to open the doors for entrepreneurs to new markets. These include investment funds from Latin America, such as Newtopia VC, which pays special attention to the region to strengthen relationships between entrepreneurs and investors in Latin American startups.
The increase in investment made in Mexico represents an opportunity to attract capital to startups from other countries in the Latin American region. For example, according to data from the Costa Rica-Mexico Chamber of Industry and Commerce ( Cicomex ), Mexican investment in Costa Rica exceeds 1.5 billion dollars. Additionally, large-scale investors such as SoftBank, which has offices in Mexico and dozens of regional investments, recently stated that even with the current situation, they would continue to support investment in Latin America. This confidence attracts more investors to bet on the region and new Latin American startups.
In the case of Miami, the startup ecosystem is one of the fastest growing in recent years, attracting many founders, technological talent, and venture capital funds. For example, venture capital activity could mobilize $25 billion by 2030 if it follows the same trend as other cities such as Los Angeles and New York.
However, entrepreneurs must have the necessary advice to benefit from the new investment opportunities within their reach to achieve this goal as startups in Latin America. In a conversation with Diego Noriega, Managing A Newtopia VC partner, he shared how his organization wants to strengthen relationships between the investment and entrepreneurship ecosystems for the entire Latin American region from the bottom up.
Latin American Entrepreneurs require tools to succeed
Noriega points out, “We want to give entrepreneurs the tools to be prepared for their next investment phases. So, it is important that startups in Latin America are equipped with techniques to obtain new rounds of financing, perfect execution, growth, and development for their businesses. They also require tools to align partners and teams and a high quality and variety of contacts from other entrepreneurs and investors that may be key in the future.”
These types of activities allow the promotion of greater unity among the countries of Latin America and the elimination of borders and barriers that may exist between them to establish a more robust entrepreneurial ecosystem that adds much more value. Such a network of entrepreneurs opens doors to other markets and continues attracting foreign capital to developing countries with excellent innovation capacity.
Mexico is a Latin American startup leader
In the case of Mexico, one of the countries with the most substantial number of entrepreneurs in Latin America, its ecosystem is characterized by its culture of business resilience. The country’s rapid technological advances have led large companies such as Santander, IBM, HP, and Tesla to bet on talent in the country’s main cities.
Regarding this, the principal executive of the Spanish bank Santander in Mexico recently declared that “there is a lot of optimism regarding Mexico because we are the neighboring country of the United States. The issue of nearshoring is something you hear about everywhere nowadays.”
It is anticipated that 2023 will see an increase in investment in startups in Latin America compared to previous years and that investors will pay more attention to sectors such as fintech, e-commerce, and business software
Finally, Miami is an attractive destination for collaboration by Latin American startups due to its strategic location, growing business ecosystem, cultural diversity, favorable business policies, and access to financing.